Pasadena mortgage broker sentenced for fraud

LOS ANGELES - A federal judge sentenced the owner of a Pasadena mortgage brokerage firm to nine years in prison Friday for a mortgage fraud scheme that netted more than $30 million in loans and cost more than 20 of his clients their homes, officials said.

Eduardo Ruiz, 33, of Santa Ana, received his sentence from U.S. District Court Judge David O. Carter, U.S. Attorney's spokesman Thom Mrozek said in a written statement. He was also ordered to pay $5.7 million in restitution.

Ruiz was convicted in March of conspiracy and mail fraud in connection with his business, Premiere One Lending of Pasadena, officials said.

"Shameless con artists like Eduardo Ruiz and his cohorts prey on the most vulnerable victims they can find," U.S. Attorney Andre Birotte Jr. said. "The lengthy federal prison sentences for Ruiz and his cohorts signal the damage caused by this scheme - both to individual borrowers and to lending institutions."

Also sentenced Friday were Ruiz siblings, 36-year-old Gilma Ruiz and 26-year-old Francisco Ruiz, both of Las Vegas, for participating in the scam, Mrozek said. They received 18-months behind bars each.

Eduardo Ruiz and his employees in 2005 and 2006 falsely inflated the income of more than 100 borrowers seeking home loans, officials said. Many of them did not speak English and were unaware of the fraud.

In some cases, Eduardo Ruiz overstated borrowers' incomes tenfold, providing phony bank statements and documents to back up the false claims, according to Mrozek.

As a result, borrowers obtained large mortgage loans that they could not make payments on, Mrozek said. More than 20 loans went into foreclosure.

"Eduardo Ruiz and his cohorts knew the borrowers never had a prayer of making their mortgage payments and that many of the loans would go into foreclosure," according to Leslie P. DeMarco, Special Agent in Charge of the IRS - Criminal Investigations Los Angeles Office. "Mortgage fraud crimes drive buyers into foreclosure, leave lenders burdened with bad loans and leave neighborhoods with abandoned and deteriorating properties."

The investigation was part of a larger, nationwide federal campaign targeting financial fraud.